Tuesday, 23 November 2010
Prevention of Corruption (Amendment) Bill 2008: Second Stage
This Bill represents a significant strengthening of the law tackling corruption. It introduces a comprehensive system of protection for whistleblowers reporting corruption. It broadens the scope of the 2001 Act to ensure that the bribery of foreign officials is comprehensively addressed. In doing so it ensures compliance with the OECD Convention on Bribery of Foreign Public Officials in International Business Transactions (1997).
It is important that our international obligations in this area are met and are seen to be met. We must protect our reputation as a country where business is done above board, and where those who seek to bribe their way to personal gain or to accept bribery face the scrutiny of the courts.
The OECD has carried out an evaluation of Ireland's compliance with the terms of the convention, and a report of its recommendations was published in 2007. In response to that report we took steps to address its recommendations, in particular to raise awareness of the foreign bribery offence. Officials from my Department, and from the Attorney General's office and the Office of the Director of Public Prosecutions, have met with OECD officials to update them on the measures in place to tackle corruption. Enactment of this Bill is a key step in this area. It is a clear demonstration of our commitment to preventing and tackling corruption.
Earlier this year I made a further commitment that, once this Bill is passed, work on the consolidation of the prevention of corruption legislation would progress. The statutory provisions in this area go back to the Public Bodies Corrupt Practice Act of 1889. Subsequent to that the issue of corruption was addressed by the Prevention of Corruption Acts of 1906 and 1916. The Ethics in Public Office Act 1995 amended some of the provisions of the Acts to reflect changes in public administration and to update the penalties under the Acts. The Prevention of Corruption (Amendment) Act 2001 enabled ratification of three international instruments, namely, the 1997 Convention on the Fight against Corruption involving Officials of the European Communities or Officials of Member States of the European Union, the 1997 OECD Convention on Bribery of Foreign Public Officials in International Business Transactions, and the 1999 Council of Europe Criminal Law Convention on Corruption.
The Proceeds of Crime (Amendment) Act 2005 provided for the seizure and forfeiture of bribes. Consolidation of all this legislation will bring greater clarity and cohesion to the law in this area. The Law Reform Commission has done some extremely valuable work in this area by producing a restatement of the existing legislation which will be of great assistance in the consolidation process, and I want to thank Ms Justice Catherine McGuinness and all of her team at the commission for their ongoing work. l am sure the Members of the House will join me in doing so.
This Bill builds on the existing statutory framework. As this is an amending Bill, I believe it is useful to briefly consider the main relevant provisions of the principal Act. For our purposes today, the most relevant provisions are those setting out the relevant corruption offences in the 1906 Act as it has been amended. That Act criminalises both ends of the corrupt bargain.
Section 1 provides that an agent or any other person who (a) corruptly accepts or obtains, or (b) corruptly agrees to accept or attempts to obtain, for himself or herself, or for any other person, any gift, consideration or advantage as an inducement to, or reward for, or otherwise on account of, the agent doing any act or making any omission in relation to his or her office or position or his or her principal's affairs or business, shall be guilty of an offence.
Similarly, a person who (a) corruptly gives or agrees to give, or (b) corruptly offers, any gift or consideration to an agent or any other person, whether for the benefit of that agent, person or another person, as an inducement to, or reward for, or otherwise on account of, the agent doing any act or making any omission in relation to his or her office or position or his or her principal's affairs or business, shall be guilty of an offence.
Furthermore, a person who knowingly gives to any agent, or an agent who knowingly uses with intent to deceive his or her principal, any receipt, account or other document in respect of which the principal is interested, and which contains any statement which is false or erroneous or defective in any particular way, and which to his or her knowledge is intended to mislead the principal, shall be guilty also of an offence.
The Bill before the House deals with an anomaly in the second offence I just mentioned which deals with what is called active corruption or the giving of a bribe. The Act as it stands refers to corruptly offering "any gift or consideration to an agent". The Bill will amend that offence to refer to the corrupt offering of "any gift, consideration or advantage". This will make it clear that all forms of advantage come within the terms of this offence as well as monetary gain.
Jurisdiction for these offences will be substantially extended in regard to corruption occurring outside the State. It will now extend to cover virtually all persons having a connection with Ireland, be they citizens or residents, including companies and corporate bodies. The range of foreign public officials coming within the scope of the legislation also has been extended to include persons under the direct or indirect control of a foreign government, as well as representatives of international organisations to which Ireland is not a party. The existing legislation already addresses international organisations of which Ireland is a member.
Perhaps the most significant aspect of the Bill is the protection it will now provide for whistleblowers. Employees who report suspected corruption offences in good faith will be protected from penalisation by employers. Bona fide whistleblowers will be protected from civil actions for damages, and they will also have the option of using a system of confidential whistleblowing. Protection of whistleblowers is of particular relevance in regard to corruption. Corruption can be a very insidious thing. Unlike daylight robbery, it is not obvious. In such circumstances, the role of whistleblowers can be crucial to discovering the crime in the first instance so that the Garda can become aware of its occurrence and investigate the offence.
Corruption cannot be tackled by legislation and policing alone. As with all crime, the support and assistance of ordinary citizens is essential to the success of the Garda Síochána's efforts. I mentioned earlier the recommendations of the OECD, and one of the key issues it touched upon was that of awareness-raising. As part of the overall Government response in this area, the Department of Justice and Law Reform set up a website, www.anticorruption.ie. It is an information portal which aims to increase knowledge of the OECD convention and of the obligations in this regard. Although established by the Department of Justice and Law Reform, it represents a cross-departmental effort to inform individuals and companies working in an international business environment about the consequences of bribery and corruption.
In addition to ensuring greater compliance with the OECD anti-bribery convention, the provisions of the anti-corruption legislation being put before the House today will also contribute to the ratification process for the 2003 United Nations Convention Against Corruption. The UN convention was opened for signature in December 2003 and was signed at that time by Ireland following approval by the Government.
The purposes of the UN Convention are to promote and strengthen measures to combat corruption more efficiently and more effectively; to promote, facilitate and support international cooperation and technical assistance in the prevention of and fight against corruption; and to promote integrity, accountability and proper management in public affairs and public property. The provisions before the House relating to bribery of foreign public officials and the protections in the Bill for "whistleblowers" will also satisfy some of the key requirements of the UN convention which the Government is committed to ratifying.
I will set out the main provisions of the Bill. Section 1 of the Bill contains a single definition, referring to the fact that references to "Act of 2001" in the Bill, mean the Prevention of Corruption (Amendment) Act 2001.
Section 2 amends section 1 of the Prevention of Corruption Act 1906, as amended by section 2 of the Act of 2001, in a number of ways. In particular, at subsection (2), the term "consideration or advantage" is substituted for the term "consideration". The words "or advantage" have been added, to clarify that, as well as monetary gain, all types of advantage come within the offence.
In section 2, the definition of "agent" is also expanded to ensure that the provisions of the Bill apply to people working for, or on behalf of, the public administration of any other country, including a person who may be under the direct or indirect control of another state. The term "agent" is also expanded to apply to agents of an organisation established by an international agreement to which Ireland is not a party. There is now an extremely broad definition of this term within the legislation.
A further amendment contained within this section is the insertion of a definition of the term "state", for a state other than the Irish State. The term "state" denoting a foreign jurisdiction will include a territory, whether in the state or outside it for whose external relations the state or its government is wholly or partly responsible; a subdivision of the government of the state; and a national regional or local entity of the state. The effect of this is to extend the jurisdiction and scope of the legislation. This will ensure that officials of regional or local authorities of other states or of their dependent territories come within the ambit of the legislation.
Section 3 amends section 7 of the 2001 Act which deals with corruption occurring outside the State. Subsection (1) will be amended to ensure that all persons, whether or not they are agents, will be addressed by the section.
This section of the Bill also deals with the issue of extra territorial jurisdiction for the offence of bribery of foreign officials. Normally Irish law is territorial in its jurisdiction, and applies only to acts done in Ireland. Where it does extend to acts done outside the State, it usually incorporates a dual criminality provision. In other words, a wrongful act done abroad must usually be considered an offence in that place as well as in Ireland before extra-territorial jurisdiction applies. There is no dual criminality provision for the offence created by this section, because within the anti-corruption legislation the intention is to ensure that an act which would constitute a corruption offence in this State is also an offence if committed outside of Ireland, which in most instances is likely to be the case in the context of bribery of foreign officials.
This new section extends substantially liability for corruption occurring outside the State. The provision will allow this State to exercise jurisdiction in circumstances where an Irish citizen, a person ordinarily resident in this State, a company registered in Ireland, any other body corporate established under the laws of the State, or any Irish official commits a corruption offence overseas. This represents a significant advance in the law. It means that the law cannot be evaded simply by asserting that any alleged act of corruption happened in a place beyond the jurisdiction of Irish law. It also makes it clear on the international stage that Ireland is fully signed-up to fight corruption wherever it occurs.
Section 4 of the Bill amends the Act of 2001 by inserting a new section 8(A) in that Act. This amendment provides for the protection of persons reporting offences under the Prevention of Corruption Acts 1889-2010, which is the proposed collective citation of the anti-corruption legislation, following enactment of this measure. The new provision provides immunity from civil suit for any person who reports, in good faith, offences under this legislation to an appropriate person. Subsections (1) and (2) provide that a person shall not be liable in damages or any other form of relief should they report, in writing or otherwise, to an appropriate person, their opinion that an offence under the Acts has been or is being committed. This is an important and broad-reaching measure. It provides protection to whistleblowers across all sectors and aims to encourage them to come forward and report corruption.
The protection applies automatically to persons making reports under this section. The protection can be displaced where it is shown that the person has knowingly made a false, misleading, frivolous or vexatious report, or has been reckless in that regard. Furnishing information in connection with the report which one knows to be false or misleading will also negate the protection. Simply put, a person who acts reasonably and honestly in reporting their opinion will be protected.
This section also contains protection for employees against penalisation or the threat of penalisation by an employer for having reported their opinion that an offence under the Acts is being or has been committed. Penalisation is very comprehensively defined as:
Any act or omission by an employer, or by a person acting on behalf of an employer, that affects an employee to his or her detriment with respect to any term or condition of his or her employment and, without prejudice to the generality of the foregoing, includes—
(a)suspension, lay-off or dismissal,
(b)the threat of suspension, lay-off or dismissal,
(c)demotion or loss of opportunity for promotion,
(d)transfer of duties, change of location of place of work, reduction in wages or change in working hours,
(e)the imposition or the administering of any discipline, reprimand or other penalty (including a financial penalty),
(f)unfair treatment, including selection for redundancy,
(g)coercion, intimidation or harassment,
(h)discrimination, disadvantage or adverse treatment,
(i)injury, damage or loss, and
(j)threats of reprisal.
This provision is based on similar anti-penalisation provisions in employment law.
The section also provides for a number of offences. Making a communication under subsection (1) which a person knows to be false will be an offence. While it is important to encourage genuine whistleblowers, it is also important to balance their protection with a suitable deterrent and punishment for those who would knowingly traduce another person without regard to their constitutional right to a good name. An employer who causes or permits or threatens to penalise a whistleblower for rightly exposing corruption will be guilty of an offence.
Subsection (10) makes it an offence to make a false statement wilfully under oath at a Labour Court hearing under Schedule 1, and subsection (11) makes it an offence to refuse to attend or give evidence or produce a document to the Labour Court.
A number of key terms are defined in subsection (16) including the following. An appropriate person to whom a report may be made is defined as a member of the Garda Síochána, an employer or their nominee, an Irish diplomat abroad, or a foreign law enforcement officer.
Section 5 of the Bill substitutes a new section 9 for that currently in the 2001 Act. That section enables responsibility for an offence under the relevant Acts, to be attributed to certain of its officers so that individuals, as well as the corporate entity, can be held liable for the offence in particular circumstances where committed by a corporate body. The new section makes specific reference to unincorporated bodies.
The section also extends the period during which proceedings can be brought for summary offences to 12 months from the date of commission, or six months from the coming to light of sufficient evidence, whichever is the later, but no later than two years from the date of commission.
Section 6 of the Bill relates to the protection for persons reporting offences as set out at section 4 above.
Schedule 1 provides redress for employees penalised for reporting an offence under the Acts in good faith. The procedures set out in the Schedule include complaints to a rights commissioner and there is provision for an appeal of the commissioner's decision to the Labour Court by the parties concerned. In proceedings before a rights commissioner or the Labour Court concerning penalisation of an employee for whistleblowing, paragraph 3, subparagraph (7) provides a rebuttable presumption that an employee acted in good faith, when whistleblowing.
The Schedule also provides that if the alleged contravention by an employer constitutes a dismissal, the employee may seek redress under the Unfair Dismissals Acts or at common law or from a rights commissioner under this Schedule but not under both.
Schedule 2 was inserted into the Bill on Committee Stage in the Dáil following consideration of OECD recommendations concerning confidentiality. The Schedule now provides for a whistleblower to approach a confidential recipient, that is, a member of the Garda Síochána or of the civilian staff of the Garda Síochána appointed by the Garda Commissioner to receive confidential communications. The provisions of the Schedule are based largely on the Garda Síochána (Confidential Reporting of Corruption or Malpractice) Regulations. It provides generally that a confidential communicator's identity is to be kept confidential. A confidential communicator is a person who communicates his or her opinion that corruption is being or has been committed to a confidential recipient as distinct from reporting to an appropriate person in the ordinary course of events.
Paragraph 3 imposes requirements on confidential communicators to disclose all records and information relevant to the alleged offence to the confidential recipient and to identify themselves to the confidential recipient. This is a common-sense provision. For a confidential communicator to be protected, he or she must be identifiable. To disclose all relevant records and information is clearly something a whistleblower would want to do, but in the case of a confidential communicator it is even more important to ensure the Garda can complete an investigation as efficiently and effectively as possible and thus reduce the need for the Garda to revert to the whistleblower.
Paragraph 4 requires a confidential recipient to transmit the confidential communication to the Garda Commissioner as soon as possible. Paragraph 5 requires the Garda Commissioner and anyone acting on his or her behalf to take all practicable steps to ensure the identity of a confidential communicator is not disclosed.
The Schedule provides generally that a confidential communicator's identity is to be kept confidential. Paragraph 6 details the limited circumstances in which a confidential communicator's identity can be disclosed and the steps to be taken before such disclosure. Paragraph 6(1) provides that the Garda Commissioner can ask a confidential recipient to disclose a communicator's identity where the Commissioner is satisfied that disclosure is necessary for the investigation of the alleged offence. The Commissioner must set out his reasons for this. Before revealing to the Commissioner the identity of a communicator, a recipient must be satisfied that the Commissioner has taken all practicable steps to investigate the offence, consider the communicator's views regarding the disclosure of his or her identity, and be satisfied that disclosure is necessary, having regard to all the circumstances.
Paragraph 6(2) permits the Commissioner to disclose the identity of a communicator to a member or civilian staff member of the Garda Síochána or the Director of Public Prosecutions where necessary for the investigation or prosecution of the alleged offence. Paragraphs 6(3) and 6(4) prevent further disclosure by a member or civilian unless authorised in writing by the Commissioner, which authorisation may only be given where necessary. Paragraph 6(5) places a restriction on any disclosure of a communicator's identity unless it is authorised by this paragraph or done with the written consent of the communicator or under a court order.
As Members can see, the Schedule provides mechanisms for a comprehensive and balanced system which protects the confidentiality of whistleblowers while allowing for investigations and prosecutions to proceed. Section 7 is a standard technical provision, providing that the Prevention of Corruption Acts 1889 to 2005 and this Bill may be read as one.
I acknowledge the considerable input from the OECD into the development of this legislation through its review of our laws and systems. Dialogue with the OECD and with our partners in the Council of Europe Group of States against Corruption, GRECO, has helped in no small way to refine and sharpen our response to corruption through the development of this Bill. The contribution to the work by the Office of the Attorney General and the Office of the Director of Public Prosecutions has been most helpful and I thank the officials of those offices.
This Bill strengthens the laws against corruption. In international circles, it puts Ireland at the forefront in terms of the protection it provides for whistleblowers. It extends our extra-territorial jurisdiction in the area of corruption to ensure our international obligations to tackle the bribery of foreign officials are being met. It paves the way for consolidation of our laws on corruption and sends out a clear message that corruption will not be tolerated by this State either here or beyond our borders. I look forward to hearing what Senators have to say in this debate.
I welcome the legislation, which is a step forward in the fight against corruption and the protection of whistleblowers. I also welcome the commitment by the Minister to consolidate the corruption legislation in the future, although I am not sure whether the Minister will have time to see that through.
This legislation is, by and large, a result of serious criticism by the OECD of the manner in which the UN Convention against Corruption was being implemented in this country. It conducted a number of evaluations and found that some of the provisions of the legislation were inadequate. It was also critical of general awareness of the legislation and called for the introduction of provisions on whistleblowers.
The Minister stated:
I acknowledge the considerable input from the OECD into the development of this legislation through its review of our laws and systems. Dialogue with the OECD and with our partners in the Council of Europe Group of States against Corruption, GRECO, has helped in no small way to refine and sharpen our response to corruption through the development of this Bill.
I suspect this was tongue-in-cheek. The fact is this is being done to fulfil our international obligations. We are adopting this legislation to prevent further embarrassment to the State due to our being out of line in the implementation of the relevant convention.
The Minister also said that corruption could not be tackled through legislation and policing alone, and that is true. We acknowledge that the political culture of corruption became established under Fianna Fáil taoisigh from the time of Charles Haughey to the present day, which meant that corruption at all levels was not taken seriously or tackled. It permeated general society, and this has contributed to many of the problems we have at present, whether in our banking or financial sector or areas of the public sector. It is the political culture which sets the scene for maintaining standards in the various institutions and generally in society. The present and previous Fianna Fáil-led Governments have much to answer for in that regard.
The Minister has indicated at various times that we adopt a sectoral approach to whistleblowing, with provisions in different Acts. The best practice worldwide is to have general legislation to protect whistleblowers which can be adopted for specific cases. Having said that, I welcome the establishment of protections in this legislation, especially for employees. What is needed, particularly with regard to bribery of foreign public officials, is greater awareness in the business community. Ireland is an open economy and has a major export sector, which means it is important that people are aware of their obligations when dealing with foreign officials and that there are serious sanctions in domestic legislation. The OECD evaluation report clearly highlighted a lack of awareness of the convention and its provisions, and the State bodies themselves did not feel they were responsible for raising awareness. Given the importance of the export sector and of conducting our business affairs worldwide in a manner that is in accordance with international law, the Government has a responsibility to ensure greater awareness of these provisions. It has the ability to do so in terms of the support given to industry and exporters. In respect of the receipt of grants etc., this legislation should be highlighted for the export sector at all times. Having said this, it is a small step in meeting international obligations and commitments we made regarding the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions to which we signed up in 2003. All we are doing is tidying the defective legislation in place. On that basis, I welcome the Bill.
I also welcome the Bill which strengthens the law on the bribery of foreign officials in compliance with the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. It is welcome that the Minister has said we will see a consolidation of prevention of corruption legislation which, when codified, will make the law on corruption easier to understand.
The Bill provides protection for whistleblowers. For too long we have had a culture of knowing certain things go on, resulting in people going home from work feeling there is nothing they can do about it. I recently met such a person. Employees need a certain level of education to ensure they understand the nature of their responsibilities to their employers and the State. It is incumbent on the Department and the media to highlight the strengthening of the law in this area. Owing to our history and colonial past, we have inherited an attitude of viewing employers and those involved in law enforcement as not quite the enemy but as people to whom we cannot or are afraid to speak. I hope the enactment of this legislation will result in a change to that culture.
From an international perspective, increasing the protection for whistleblowers and strengthening the arm of the State in dealing with corruption will send the right signal to ensure business transacted abroad is protected and that our officials understand that when acting abroad in the name of an Irish company or the State, they are covered by the rigours of the legislation.
Senator Regan spoke about the corruption culture which cannot be denied, but I do not believe it is all on one side. Mobile phone licensing springs to mind and extensions to Deputies' houses etc. It happens across the board and taoisigh other than just Fianna Fáil taoisigh were involved.
Yes, we are. As a younger Member of the Oireachtas, it is time we stopped this pettifoggery and trying to blame one side. The people do not care who is to blame; they want to see change and politicians standing up and being counted and having the courage to introduce the change required. They do not want to see the same old nonsense that has continued for years continued in what we consider will be a new government next year.
All we are doing is turning people away from the noble profession of politics. I decided to get involved, despite having had no familial involvement. I have significant familial involvement in community activities, with my parents spending every waking hour training young people to play hurling. What we are doing is bringing down the body politic which needs confidence. What the Senator said was mealy-mouthed. We are talking about the prevention of corruption which extends across the board. We want to promote integrity, accountability and proper management of our public affairs and public property. The protection of whistleblowers is long overdue and I am glad to be here on the day we are introducing whistleblowers legislation which is well balanced and protects against vexatious reports.
Does the scope of the Bill include members of committees and boards? There was an example in my constituency of Wexford of a politician who blew the whistle on certain things that were going on which did not involve my party and he ended up in a Garda station being asked where he had obtained the information. Whistleblower's charter legislation would have protected him in that regard. He was only trying to serve the public in the best way he knew how.
We have a sophisticated body of anti-corruption legislation dating back to the late 19th century. In addition to having the legislative code correct, we need to see it being carried out and people being brought to task for corrupt acts. While I am not naming anyone in that regard, the public at large require persons who have been corrupt to be dealt with in a fair and judicious way under the law. I welcome the Bill.
I thank Senators for their comments on this legislation which has passed through the Dáil. Obviously we would like to see its quick passage through the Seanad. I have indicated that we wish to proceed with the consolidation of all such legislation which dates back as far as 1889. During the drafting phase in my Department I was insistent that the Bill be such that it would refer not only to the net point, the implementation of the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, but also include in dealing with corruption very broad provisions on whistleblowing.
In the other House a number of Deputies mentioned the Government's position on whistleblowing generally. The Government previously decided that we would deal with whistleblowing on a sector-by-sector basis rather than providing omnibus legislation that would cover everything. That was based on advice received from the Attorney General who recommended that it would be far more sustainable from a legal point of view to have specific whistleblowing provisions designed to deal with specific issues. Since that original decision to deal with it on a sector by sector basis we have introduced specific whistleblowing provisions in myriad legislative measures, ranging from the Protections for Persons Reporting Child Abuse Act 1998 to the Charities Act 2009, the Inland Fisheries Act 2010, the Employment Agency Regulation Bill 2009, the Employment Law Compliance Bill 2008 and the Local Government (Dublin Mayor and Regional Authority) Bill 2010, all of which contain whistleblowing provisions. If it was an omnibus provision and one of the provisions was knocked down legally, it would mean that across all the sectors we would have to introduce amending legislation promptly. The advice was that it would be better to do it on a sector by sector basis and tailor the whistleblowing provisions to suit circumstances.
Senator Regan referred to the working group evaluation by the OECD which carried out peer-led on-site reviews in Ireland in October 2006 and again in June 2008. The reviews were part of an ongoing process by the group in assessing each signatory country's adherence to the OECD convention. As I said, if the Bill is passed, we will have one of the most modern legislative measures on the Statute Book. However, I am firmly of the view that we should have consolidated legislation. Our near neighbour has such legislation. It would make it easier for our European counterparts when they come here, particularly from the agencies which oversee anti-corruption legislation in member states. Most of those in oversight bodies who come to this country are from jurisdictions which are dissimilar to the common law jurisdictions of the Republic and Britain. Rather than give them myriad legislative measures and enactments relating to corruption, it would be better to have everything in one place. It would obviously be far better for practitioners also if this was the case. It is part of the ongoing process — the desire of the Government — to consolidate as much legislation as possible.